THE Hong Kong stock exchange said yesterday it has agreed to work with mainland bourses toward the inclusion of dual-class shares in a cross-market trading link, marking a step toward resolving a dispute regarding the link.

Hong Kong Exchanges and Clearing (HKEX), operator of Hong Kong’s stock exchange, said in a statement that Hong Kong-listed dual-class shares will need to establish their trading stability during an initial period after which they could be included in the stock connect program, if other requirements are met.

HKEX also said that it would set up a working group with the Shanghai and Shenzhen stock exchanges to formulate the specific programs and rules for the inclusion of dual-class shares in the trading link.

A spokesman for HKEX said no further details of the program were immediately available.

The announcement came after the two mainland stock exchanges said Saturday they would not expand the stock connect program with Hong Kong to foreign firms, so-called “stapled” securities and companies with different voting right structures.

The mainland exchanges said the move was aimed at protecting less sophisticated investors from the complexities of such shares.

The ban was considered a blow to Hong Kong, which has been working to improve its ability to attract mainland tech companies to list in the city.

HKEX said the three exchanges acknowledged that as mainland investors were not yet familiar with weighted voting rights (WVR) companies, there was a need to consider the maturity and regulatory practices of the two markets.

Shares of smartphone maker Xiaomi Corp. plunged Monday after the weekend announcement, before recovering later in the day.

Xiaomi was the first company to list in Hong Kong with weighted voting rights and investors had hoped that its inclusion in the Hang Seng Composite Index this month would help attract capital from the mainland.

On Monday, HKEX chief executive Charles Li said he was flying to Beijing to discuss the rule change with mainland authorities.

The stock connect program, which links exchanges on the mainland with the Hong Kong bourse, allows mainland investors their only direct means of trading offshore stocks and international investors access to mainland firms. (SD-Agencies)